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a&o Hostels reports record-half year earnings, eyes towards sustainability and digital advancements

  • a&o Hostels
    Photo credit: a&o Hostels
  • Advancement to Green Sign Level 4: the a&o team with Arben Maliqi (r., ESG Project Manager) Julian Reingraber (l., GreenSign Business Development Manager), and Amalia Martis (Assistant to the General Manager at a&o) is delighted about the success of the two properties in Copenhagen.

a&o Hostels announces best half-year earnings ever, boosted by pent-up demand and focus on sustainability. CEO Oliver Winter underscores commitment to CO2 neutrality and digital guest experience.

BERLIN, GERMANY – With total sales reaching over 100 million euros, the Berlin based hostel chain, a&o Hostels, has announced its best half-year earnings in the company’s history, while exceeding last year’s results by 47%. The already strong months of May and June, with room occupancy rates over 80%, were joined by “an exceptionally strong start to the year,” confirms a&o Hostels CEO Oliver Winter. More than one million overnight stays in the first quarter ensured full occupancy, particularly in Berlin, Hamburg and Venice.

Winter identifies the reason for the consistent momentum from the start of the year primarily due to the continued pent-up demand from groups and school classes. Groups travel more flexibly and occupy properties in the spring—outside of the usual summer months—and tend to book multi-bedroom options with a&o.

Additionally, the momentum can be attributed to an increasingly budget-oriented demand, especially from families and young international guests—thus, the brand has seen strong growth in the categories of family rooms and dorms (shared rooms).

Lastly, Winter associates the steadily growing number of overnight guests (H1 2023: 2,840,000 / H1 2022: 2,340,000) as confirmation of the positive sentiment surrounding the company’s commitment to sustainability. “Guests actively demand sustainability, give positive feedback and make suggestions themselves,” Winter states. Whether it’s event organizers, schools or guests at the reception desks—the response to a&o’s sustainable efforts is “gratifying, motivating and very helpful.” a&o has registered a very high level of interest in sustainability issues, particularly among its younger demographic—as guests aged up to 30-years-old encompasses approximately 52% of the brand’s current guest share.

We are also seeing a clear early booking trend,” explains Winter. In 2022, almost 50% of summer guests booked less than 24 hours before arrival; this year, the numbers are trending around 30% . In the family and group travel segments, the Berlin budget group was able to increase once again compared to the previous year—including at a&o Weimar, which boasts outdoor gardens, programming and activities enjoyed by travelers.

Further half-year figures at a glance:

– Over 4,000 calls a day to the reservation hotline

– 72% room occupancy (2022: 60%)

– 38% increase in visitors to the website in May/June

– Average room occupancy around 80% in May and 85% in June

– Summer occupancy of up to 90% expected

a&o invests 20 million euros in sustainable renovations

With around 3.73 kg of CO2 per overnight stay, a&o is undercutting the competition by up to 75%. “That’s not enough for us yet. If we want to enable sustainable travel and thus be a forward-looking industry, we have to continue to change the way we think and act and, among other things, reduce consumption and emissions even more drastically,” says Winter.

CO2 neutrality by 2025 is the next major milestone for Europe’s leading hostel chain, which currently operates 39 properties in 25 cities and nine countries. In the coming year, the company will invest up to 20 million euros in energy-related renovation measures alone. 90% of the a&o locations are existing properties: “Preservation instead of new construction is a key sustainability motto for us and thus also a growth strategy.”

Reaching the destination in two minutes – digitization for more guest comfort

a&o is also making further progress in terms of digitization. Since the beginning of August, guests at the a&o Munich Hackerbrücke have been able to enjoy the latest generation of self-check-in. The in-house development allows guests to check in quickly and conveniently—five steps in under two minutes. More properties are to be equipped with the new terminals as soon as possible. a&o has already been offering self-check-in machines since 2018. Other digital offerings such as F&B ordering via app, mobile room key and digital guest folder are also being expanded.

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Vicky is the co-founder of TravelDailyNews Media Network where she is the Editor-in Chief. She is also responsible for the daily operation and the financial policy. She holds a Bachelor's degree in Tourism Business Administration from the Technical University of Athens and a Master in Business Administration (MBA) from the University of Wales.

She has many years of both academic and industrial experience within the travel industry. She has written/edited numerous articles in various tourism magazines.